UNITED STATES
SECURITIES AND EXCHANGE
COMMISSION
Washington, D.C.
20549
Form 8-K
Current Report
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event
reported): October 23, 2009 (October 22, 2009)
Nyer Medical Group,
Inc.
(Exact name of registrant as specified
in its charter)
Commission File
Number: 000-20175
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Florida
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01-0469607
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(State or other
jurisdiction
of
incorporation)
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(IRS Employer
Identification
No.)
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13 Water Street, Holliston, MA
01746
(Address of principal executive
offices, including zip code)
(508) 429-8506
(Registrant’s telephone number,
including area code)
Check the appropriate box below if the
Form 8-K filing is intended to simultaneously satisfy the filing obligation of
the registrant under any of the following provisions:
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¨
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Written communications pursuant to
Rule 425 under the Securities Act (17 CFR
230.425)
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x
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Soliciting material pursuant to
Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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¨
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Pre-commencement communications
pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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¨
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Pre-commencement communications
pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item 1.01. Entry into a Material
Definitive Agreement.
Asset Purchase
Agreement
On October 22, 2009, D.A.W., Inc.
(“DAW”), a wholly-owned subsidiary of Nyer Medical Group, Inc. (“Nyer”), and
Nyer entered into an Asset Purchase Agreement (the “WAG Agreement”) with
Walgreen Eastern Co., Inc., a New York corporation (“WAG”), for the sale of a
substantial portion of DAW’s operating assets,
including prescription files and
inventory of a total of 12 neighborhood pharmacies which includes the assignment
of eight leases (the “Acquired Assets”), for a purchase price, subject to
certain adjustments, of $12.0 million plus up to $5.75 million of qualifying
inventory and $1.1 million of operating equipment (the “WAG
Transaction”).
DAW, Nyer and WAG made customary
representations, warranties and covenants in the WAG Agreement. In
addition, DAW and Nyer agreed that, for a period of three years, they would
refrain (and cause their current controlled affiliates to refrain) from
competing within a certain area of the pharmacies whose assets were included in
the Acquired Assets, with certain exceptions set forth in the WAG
Agreement.
The parties have agreed to indemnify
each other against certain losses, including losses for breaches of
representations, warranties and covenants. Each of DAW’s and Nyer’s
indemnification obligations begin at an aggregate of $50,000 and are limited to
a total of $1,200,000 or, with respect to the inaccuracy of certain fundamental
representations, $4,000,000. Further, DAW’s and Nyer’s
indemnification obligations terminate 90 days following the closing date, with
certain exceptions, including an extension of the indemnification period for up
to 12 months for claims related to certain representations and 3 years for
claims related to noncompetition covenants. WAG agrees to indemnify
DAW and Nyer for its breach of the WAG Agreement for a period of 12 months,
except in certain circumstances set forth in the WAG Agreement, and its
indemnification obligations are for an unlimited amount.
DAW, Nyer and WAG can terminate the WAG
Agreement in certain specified instances, as provided in the WAG
Agreement. If the closing does not occur and Nyer or DAW enters into
an alternative transaction under certain conditions specified in the WAG
Agreement, DAW would owe to WAG a breakup fee in the amount of $300,000 and
reimbursement of actual out-of-pocket expenses in an amount up to
$200,000.
The completion of the WAG Transaction is
subject to certain closing conditions set forth in the WAG Agreement, including
the approval of the WAG Transaction
at a special meeting of Nyer’s
shareholders which is expected to be held on or about December 15, 2009 (the
“Special Meeting”)
.
Nyer’s Board of Directors engaged
Newbury Piret Companies, Inc. (“Newbury Piret”) as financial advisor to evaluate
the WAG Transaction. The Board of Directors of Nyer and DAW (the
“Boards”) unanimously approved the WAG Transaction. In approving the WAG
Transaction, the Boards considered the depressed market price of the stock, the
historically low trading volume and volatility of bid prices; market pressures
on margins and operating costs that would have an adverse effect on the
operating results of the pharmacies, a fairness opinion from Newbury Piret and
other considerations.
The
foregoing description of the WAG Agreement is qualified in its entirety by
reference to the full text of the WAG Agreement, a copy of which is attached
hereto as Exhibit 2.1 to this Current Report on Form 8-K and incorporated
herein.
Stock Purchase
Agreement
On October 23, 2009, Nyer and DAW
entered into a Transaction Agreement (the “DAW Stock Agreement”) with certain
management investors named therein (the “Investors”) for the sale of the stock
of DAW, under which Nyer will receive a benefit of $1,500,000 after giving
effect to liabilities to be retained by DAW (the “DAW Stock
Transaction”).
DAW and Nyer made customary
representations, warranties and covenants in the DAW Stock
Agreement. In addition, DAW and Nyer agreed, on the terms set forth
in the DAW Stock Agreement, not to solicit or encourage any alternative sale
transactions.
DAW, Nyer and the Investors can
terminate the DAW Stock Agreement in certain specified instances, as provided in
the DAW Stock Agreement. If the closing does not occur and Nyer and
DAW enter into an alternative transaction under certain conditions specified in
the DAW Stock Agreement, DAW and Nyer would owe to the Investors a breakup fee
in the amount equal to the actual out-of-pocket expenses, including attorneys’
fees, incurred by the Investors in connection with the DAW Stock
Transaction.
The completion of the DAW Stock
Transaction is subject to certain closing conditions set forth in the DAW Stock
Agreement, including the approval of the DAW Stock Transaction at the Special
Meeting and the approval and closing of the WAG Transaction.
The DAW Stock Transaction was reviewed
by a special committee of the Board of Directors of Nyer comprised of
independent directors (the “Special Committee”). The Special Committee engaged
Newbury Piret to evaluate the DAW Stock Transaction. The DAW Stock Transaction
was unanimously approved by the Special Committee and recommended to the Boards
by the Special Committee. The Boards also unanimously approved the DAW Stock
Transaction. In approving the DAW Stock Transaction, the Special Committee and
the Boards considered the fact that substantially all of the assets of DAW would
be sold to WAG under the WAG Agreement, the lack of interest by WAG in the
assets subject to the DAW Stock Agreement, a fairness opinion from Newbury Piret
and other considerations.
The
foregoing description of the DAW Stock Agreement is qualified in its entirety by
reference to the full text of the DAW Stock Agreement, a copy of which is
attached hereto as Exhibit 2.2 to this Current Report on Form 8-K and
incorporated herein.
The WAG
Agreement and DAW Stock Agreement (the “Agreements”) have been included to
provide investors with information regarding their terms. It is not intended to
provide any other factual information about Nyer or DAW. The representations,
warranties and covenants contained in the Agreements were made only for purposes
of such agreements and as of the specific dates therein, were solely for the
benefit of the parties to such agreements, and may be subject to limitations
agreed upon by the contracting parties, including being qualified by
confidential disclosures exchanged between the parties in connection with the
execution of the Agreements. The representations and warranties may have been
made for the purposes of allocating contractual risk between the parties to the
agreements instead of establishing those matters as facts, and may be subject to
standards of materiality applicable to the contracting parties that differ from
those applicable to investors. Investors are not third party beneficiaries under
the Agreements and should not rely on the representations, warranties and
covenants or any descriptions thereof as characterizations of the actual state
of facts or condition of the Nyer, DAW or any other party to the Agreements.
Moreover, information concerning the subject matter of the representations and
warranties may change after the dates of the Agreements, which subsequent
information may or may not be fully reflected in Nyer’s public
disclosures.
Item
3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or
Standard; Transfer of Listing.
Item 8.01 Other
Events.
In
conjunction with the WAG Transaction and the DAW Stock Transaction, the Board of
Directors of Nyer approved the liquidation and dissolution of Nyer pursuant to a
Plan of Dissolution (the “Plan of Dissolution”). Implementation of the Plan of
Dissolution is subject to obtaining shareholder approval of the WAG Transaction,
the DAW Stock Transaction and the Plan of Dissolution (the “Transactions”) at
the Special Meeting. Upon shareholder approval of the Transactions and the
closing of the WAG Transaction and the DAW Stock Transaction, Nyer intends to
proceed with the orderly wind down and dissolution of Nyer pursuant to the Plan
of Dissolution.
The Board
of Directors of Nyer has also authorized Nyer’s officers to cause the common
stock of Nyer to be delisted from the Nasdaq Stock Market following the closing
of the WAG Transaction.
A copy of
the press release, dated October 23, 2009, announcing the WAG Transaction, the
DAW Stock Transaction and the Plan of Dissolution is attached hereto as Exhibit
99.1.
Additional
Information and Where to Find It
In
connection with the proposed transactions, Nyer Medical Group, Inc. ("Nyer")
will file a proxy statement and other relevant documents with the Securities and
Exchange Commission (“SEC”). NYER SHAREHOLDERS ARE URGED TO READ THE PROXY
STATEMENT WHEN IT BECOMES AVAILABLE AS IT WILL CONTAIN IMPORTANT INFORMATION
ABOUT THE TRANSACTIONS AND RELATED MATTERS. NYER
SHAREHOLDERS WILL HAVE ACCESS TO FREE COPIES OF THE PROXY STATEMENT (WHEN
AVAILABLE) AND OTHER DOCUMENTS FILED WITH THE SEC BY NYER THROUGH THE SEC
WEBSITE AT
WWW.SEC.GOV
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THE PROXY STATEMENT AND RELATED MATERIALS MAY ALSO BE OBTAINED FOR FREE (WHEN
AVAILABLE) FROM NYER BY DIRECTING A REQUEST TO: NYER MEDICAL GROUP, INC., 13
WATER STREET, HOLLISTON CORPORATION, MASSACHUSETTS 01746, ATTENTION: CHIEF
EXECUTIVE OFFICER, TELEPHONE: (508) 429-8506.
Nyer and
its directors and executive officers and other members of management and
employees may be deemed to participate in the solicitation of proxies in respect
of the proposed transactions. Information regarding Nyer's directors and
executive officers is available in Nyer's annual report on Form 10-K for the
year ended June 30, 2009, which was filed with the SEC on September 28, 2009.
Additional information regarding the interests of such potential participants
will be included in the proxy statement and the other relevant documents filed
with the SEC when they become available.
Item
9.01 Financial Statements and Exhibits.
(d) Exhibits.
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Exhibit
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Number
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Exhibit
Description
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2.1
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Asset
Purchase Agreement, dated as of October 22, 2009, among Walgreen Eastern
Co., Inc., D.A.W., Inc. and Nyer Medical Group, Inc.
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2.2
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Transaction
Agreement, dated as of October 23, 2009, among, D.A.W., Inc., Nyer Medical
Group, Inc. and certain management investors listed
therein
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99.1
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Press
Release of Nyer Medical Group, Inc. dated October 23,
2009
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Signatures
Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned hereunto duly
authorized.
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Nyer Medical Group,
Inc.
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Date: October 23,
2009
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By:
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Mark A.
Dumouchel
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President and Chief Executive
Officer
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